India Base Metals
Copper down tracking LME on weak demand from China
This story was originally published at 18:33 IST on 22 July 2024
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By J. Navya Sruthi
MUMBAI – COPPER futures fell on the Multi Commodity Exchange of India today, tracking a fall on the London Metal Exchange due to concerns about demand from China, the biggest consumer of the metal.
Despite a 10-basis point reduction in prime lending rates by the People's Bank of China today, market participants expect more stimulus measures from the central bank, analysts said. Meanwhile, base metals are expected to trade lower.
The one-year loan prime rate was lowered by 10 bps to 3.35% from 3.45% previously, while the five-year loan prime rate was reduced by the same margin to 3.85% from 3.95%. The Chinese central bank's decision comes amid a decline in economic growth in the second quarter. Data released last week showed GDP growth in China was 4.7% in the second quarter, compared with the forecast of 5.1%.
Last week, the base metal recorded its biggest weekly loss in two years as markets were disappointed with China's Third Plenum failing to come up with new policies to boost economic growth, Dow Jones quoted ANZ Research as saying in a note. However, further downside in prices will likely be limited by supply issues in South American mines, Dow Jones reported.
Investors will take cues from US Purchasing Managers' Index data, due on Wednesday, and US core personal consumption expenditure data on Friday.
* At 1655 IST, on the MCX, the July contract of:
–ALUMINIUM was at 217.25 rupees a kg, down 1.6%
–Copper was at 815.25 rupees a kg, down 0.6%
–LEAD was at 186.9 rupees a kg, down 0.1%
–ZINC was at 258.95 rupees a kg, down 0.8%
* Outlook for the evening session on the MCX:
–Aluminium contract seen at 217.0-222.5 rupees
–Copper seen at 806.3-826.7 rupees
–Lead seen at 185.7-188.5 rupees
–Zinc seen at 254.5-267.1 rupees
End
US$1 = 83.66 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Aditya Sakorkar
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